Sony calls the technology in the Sola, set to go on sale in the second half of 2012, a "floating touch" user interface.

A number of firms around the world have been exploring gesture control technology.

Apple, Microsoft and U.S. mobile phone chip maker Qualcomm are currently developing camera-based touchless technology to allow users to answer the phone, navigate the Web and scan through photos using gestures rather than having to touch the screen.

Sony's new "floating interface" is not quite the same, however; the user's finger will instead act like a mouse cursor, highlighting a link that can then be activated with a single tap.

But some analysts say they wonder if the feature will be popular or even practical.

"It is certainly an original piece of technology, and may be useful, for instance, when your hands are wet, but we still need to see other practical implications of it," Chris Barraclough, devices editor at Mobile Choice magazine, told the BBC.

China smartphone market to overtake US: IDC
Singapore (AFP) March 16, 2012 - China is set to be the biggest smartphone market this year after shipments in the second-half of 2011 outstripped the US, a technology research firm said Friday.

Figures by US-based International Data Corporation (IDC) indicate China will account for 20.7 percent or almost 137 million units of the global smartphone market from 18.2 percent in 2011.

In contrast, the US share of the overall market is expected to decline to 20.6 percent this year from 21.3 percent in 2011, said IDC, which is projecting 660 million smartphones will be shipped in 2012.

"(China) smartphone shipments are expected to take a slim lead over the US in 2012 before the gap widens in the coming years," said Wong Teck Zhung, IDC's regional senior market analyst with the client devices team.

"There will be no turning back this leadership changeover."

Much of the growth in smartphone shipments in China, and also for the other emerging markets such as India and Brazil, are being fuelled by mobile handsets running on Google's Android platform, said IDC.

"A lot of the Android models in China are priced competitively," said Melissa Chau, IDC's regional research manager.

"That is actually driving the huge growth."

Chau said the average price of a non-Apple smartphone in China sold for $324 excluding telco subsidies last year while an iPhone retailed at a much higher $760.

Australia and Hong Kong were the first countries in the region to have the new mobile system but Keeley said it would soon be available in other markets including mainland China, where the licensing process was under way.

"We're delighted to be the first in Asia Pacific to offer this innovative mobile solution," he said, noting that Asia had a $1.3 trillion small-medium business retail market combined with rapid uptake of smart phones.

"PayPal is going to change the way millions of merchants and consumers connect with each other in the Asia-Pacific region," he said.

The online financial transactions company's region headquarters is in Singapore but it serves many of its customers in the vast region remotely through a network of six sales offices, he said.

Keeley said PayPal was "looking to expand our footprint in Asia" with the opening of new offices in several countries, including India.

The company currently has six sales offices in the region, covering Tokyo, Shanghai, Hong Kong, Taipei, Singapore and Sydney. It has development centres in India and Singapore and customer support centres in China and Malaysia.

Keeley said Indonesia was another attractive market, but would not confirm if the archipelago of 240 million people was on PayPal's list for expansion.

The new PayPal Here system will allow merchants in Australia, Canada, Hong Kong, the United Kingdom and the United States to take payments using smartphones.

It uses a triangle-shaped "dongle" card reader that plugs into mobile devices to let people make purchases with vendors on the run, including small businesses that do not have merchant accounts with traditional banks.

PayPal Here software also lets shopkeepers take payments by snapping a picture of a card with a smartphone instead of having to swipe it in the dongle.

In the United States the service from eBay-owned PayPal will rival one offered by startup Square, a brainchild of Twitter co-founder Jack Dorsey.

Square has been a hit with independent entrepreneurs and small businesses ranging from masseuses and taxi drivers to farmers and bicycle shops.

PayPal plans to capitalise on its dominant position as a global service for online purchases.

"We are going to aggressively push this out to our 100 million PayPal users around the world," PayPal mobile vice president David Marcus said while unveiling the new service in San Francisco.

"We can accept any form of payment, short of barter."

PayPal Here thumb-sized plug-ins and accompanying software for smartphones are free. Here was being rolled out for Apple's iPhones with a promise that a version for Android-powered smartphones would be available soon.

PayPal will charge merchants a fee of around three percent for each transaction, depending on the market, Keeley said.

"It's going to be a huge business for us," he told reporters in Hong Kong.